Sunday, July 02, 2006

Indian Summer revisited

In April, I wrote about a bubble in Indian stock valuations, and predicted a 25% fall. In the last 2 months, we have seen a much deeper pullback. While the capitulation I would like to see has not yet shown up, it is time to tiptoe back into the Indian markets.

Similarly, the Japanese market participated in the worldwide correction, though unlike other markets Japan seems to be still in an early phase of its recovery. It is time to increase your exposure to Japan, preferably via an ETF like EWJ.